Residents in the small central North Island town of Raetihi can drink and cook with water from their taps again after it was given the all-clear.
The Makotuku stream, the town's usual source of water, was contaminated by a diesel leak in late September.
Water from the Makara stream has been used as an alternative source of water for showers and laundry in the meantime.
On Tuesday, the Ruapehu District Council announced the water can now be used for drinking. It is being put through the usual reticulated water system.
Mayor Don Cameron says by the time the Makara stream starts drying up in summer, the council will hopefully get clearance to revert to drawing drinking water from the Makotuku stream.